If France doesn't decide to go down the DVB-H route, there are many who think that could signal the end of the road for the mobile broadcast standard in most European markets
According to one industry commentator, there's a lot riding on the French.
Our source, who would rather not be named, thinks that if the French market does not decide to follow the DVB-H standard this year, then that could be the end for the mobile broadcast standard in the region as a whole.
Certainly, the signs have not been good elsewhere – and the industry is dogged by accusations of self-interest. For example, despite operator pressure, Nokia, which sits on 40-50% market share in most European markets, has not moved as fast as the industry had hoped to push DVB-H and DRM technology into its handsets.
According to the head end vendors, and this is a surprisingly widely held view, the issue has been that Nokia has tried to tie the sale of its network infrastructure to the development of its handset range.
"Nokia is saying, give us the head end, and we will give you the handsets," one competing vendor told us.
Nokia would dispute that, of course, pointing out that it has signed up to the standards in the market, enabling a multi-vendor environment at both the device and head end level.
And yet, finger pointing aside, there remain deep structural problems with the mobile broadcast TV model.
According to a new report from Nielsen Mobile, only 5% of all U.S. cell phone owners subscribe to a mobile TV service. Yet that number is the highest out of all the other worldwide markets tracked by the company. Only France and Italy came close, each at 4 percent. According to Nielsen, mobile video use isn't more prevalent due to lack of differentiating capabilities, high cost, and lack of compelling content. In fact, we are now even seeing mobile video's plateau – a point where you would normally expect to see adoption slow considerably.
In the U.S, 10.3 million mobile phone subscribers watch video content on their mobile phones each month. But the mobile video subscription market has barely grown during the past year. In Q3 2007 it was at 6.4% and by Q3 2008 it was only 7.3%. And only 26% of subscribers who paid for mobile video services during the third quarter of 2008 used them at least once a month.
Taken at face value, these numbers look bad for mobile TV's future, but of course they reflect a market that has stalled on the supply side.Could an improved advertising subsidy to subscription-based streaming mobile video services, and the rollout of mobile digital television (mobile DTV) combine to be mutually beneficial for carriers, device manufacturers, content providers, advertisers?
One example of how complex the value chain is comes from France, where there is in fact regulatory and operator pressure to get the market moving. Yet even there, transmitter company TDF has been moved to propose a slimmed down version of a mobile TV service in order to jump start the new medium. At the moment, broadcasters and mobile operators are stuck in a gridlock over the business model, delaying the proposed introduction of the service.
As they are arguing about the division of the costs, TDF has said will finance the DVB-H transmitter network and pay part of the transmission costs. It has invited all parties involved and reports are that Orange, NextRadioTV (BFM TV) and Lagardère Active (Virgin 17) have already begun talks.
Part of the less ambitious plan, as reported by is to launch the service in just Paris and five other cities instead of covering 15 cities as required by the CSA as part of the mobile TV license. Actual broadcasting could start in early 2010.
The complexities of the value chain have meant that even the most avid proponents of DVB-H have slid from their support.
The EC last year decided to add the Digital Video Broadcasting Handheld standard (DVB-H) to the EU List of Standards, which serves as a basis for encouraging the harmonised provision of telecommunications across the EU. At the time, the Commission said, "The addition of DVB-H is a new step towards establishing a Single Market for Mobile TV in Europe.
"For Mobile TV to take off in Europe, there must first be certainty about the technology. This is why I am glad that with today's decision, taken by the Commission in close coordination with the Member States and the European Parliament, the EU endorse DVB-H as the preferred technology for terrestrial mobile broadcasting," said Viviane Reding, EU Commissioner for the Information Society and Media. "The next steps for implementing the EU strategy on mobile broadcasting will include guidance on the authorisation regimes as well as the promotion of rights management systems based, as is DVB-H, on open standards".
But by the end of 2008, with the industry beginning to cool rapidly on DVB-H, the language appeared to have changed.
The EC said that "the objective of full interoperability across networks and devices remains important. Developments in the market have shown that interoperability can be achieved when stakeholders act together with a common aim of implementing a technical standard such as DVB-H."
Read that again:?"a technical standard such as DVB-H"…that's an interesting shift from, "Member States will be required to encourage the use of DVB-H".
It seems that the Commission does seem to be moving round to what many said before: that allocating spectrum on a technology-specific basis is not the way to go.
Kamil Grajski of the FLO Forum agrees that his body, which of course promotes a rival technology to DVB-H has "detected a moderation and modulation of tone with position regarding technology mandates
"Yes it is a shift in tone," he says. "It is positive because it moves towards a completion of the efforts that we've been pushing for – an overall legal certainty that the investment community needs.
"The balance is that technology is probably the least important aspect for the Commission to focus on. And even though there is no obligation, only a requirement to consider DVB-H, you can't ignore that atmosphere.
"But a major offsetting factor for us is the Commission is now talking about the most efficient use of spectrum. The key message for us is that mobile broadcast technologies are still showing tremendous differences in spectral efficiency from one generation to the next. Our vision is that DVB technology is a first generation technology and FLO is second generation.
"FLO delivers twice the number of channels, and these are not technology tempests in a tea cup. If regulators are going to insist on must-carry free to air channels, say five to seven of them, then having the ability to carry twice the number of channels in the same frequency has a direct impact on the business case."
The danger for operators is that the broadcasting industry will move on without it – if it can find a way to do so.
In the USA broadcasters have reacted to the situation, and the presence of MediaFLO, by forming the Open Mobile Video Coalition (OMVC) with the aim of developing a new standard for Mobile TV, using their existing frequency allocations. The proposal is to transmit a separate signal with the regular broadcast multiplex, allowing reception on mobile devices.
The OMVC announced that the new mobile DTV service will soon arrive in 22 U.S. cities, covering 35% of U.S. television households. The mobile service aims to provide live, local and national over-the-air digital television to mobile devices.
Included in the service are 63 stations from the 25 major broadcasters that are on board. Those include NBC Television and Fox Television.
Rather than going for completely new standards and frequency allocation, as is the case with DAB in Europe, the American coalition is opting for so-called in-band on-frequency solutions. This allows the existing broadcasters to keep their frequencies and at the same time raise a major hurdle for market entry for newcomers.
Since the announcement, many have been waiting to see how the operators react, as they are effectively disintermediated by the action. At the moment, the OMVC only consists of broadcasters and manufacturers, with the operators completely absent.
In Germany exactly that approach fell apart when the operators walked away from a model they thought prejudicial to their interests. When the authorities issued the first DVB-H license, they did so to a consortium that included broadcasters, but not mobile operators. As a result, the operators withdrew support and the license has since been handed back. There is a mobile broadcast service in Germany, but one source told us that operators cannot give it away for free at the moment, as the quality is so low.
It is ironic, then, that there are some who think that free-to-air mobile TV services may succeed where others have failed exactly because they bypass the carriers altogether. Operators may even get an uplift if they range phones that support the service. Of course, in order for that to work, either those phones will have to be more expensive to the consumer, or somebody else will have to bear the cost of subsidising the enhanced handsets. With nothing to gain after the handsets have been sold, and indeed the prospect of seeing advertising revenues leach away, why would operators commit to that market.
The vendors themselves will back what looks like shipping the most volumes. LG Electronics displayed prototype phones at CES, for example.But without operator orders, volume shipments look far off. So what is the carrot for carriers to support free TV? It must be the control of the service to the customer, and the ability to extract revenues from advertisers on the back end. Which is where we came in. Because broadcasters, faced with their own revenue problems, are not about to hand that over. And yet, if nobody compromises, this market is going nowhere. Fast.
What about TDTV?
Jon Hambidge, CMO of IPWireless, on why he things one rival model has a chance for success
What is the correct Mobile TV business model for operators and why TDTV is a good fit for that model?
We believe that there are three keys to making a mobile TV business model work for operators. The first key is to expand the notion of mobile TV to encompass a full range of mobile broadcast services. In addition to traditional linear mobile TV, mobile broadcast can support video on demand, music downloads, weather, traffic, news, and even OTA software and application loads. As mobile broadband usage takes off with HSPA USB dongles and embedded laptops, many of these applications can be moved over to unused spectrum – but to do this – the technology supporting the broadcast network has to be completely integrated with the HSPA/WCDMA network. The second key to making mobile TV successful is to lower the cost of the platform to a point where it can support mass market demand. To do this, a technology should leverage existing 3G networks and spectrum, allow network and spectrum sharing between operators, and allow seamless handoff to HSPA in less dense regions.
Our business model work suggests that 3G mobile broadcast can deliver a channel for around one tenth of the cost of DVB-H. The final key is to have a platform that can support enough channels to support both a set of free channels and enough premium channels that operators can use free TV to lower acquisition costs and drive device penetration and then drive revenues through advertising, and upsell into premium content on a pay per show, per view, or subscription basis.
Can you provide any details of the commercial London network – state of play, results, etc
New details on the UK pilot will be coming out soon. There have been some very exciting developments that we will discuss as soon as we are able.
What will the key developments be in mobile TV in 2009?
The biggest development will be the 3G ecosystem starting to align around a common 3GPP mobile broadcast standard that will be finalised as part of Release 8 of the 3GPP standard. Many operators have seen benefits of Release 7 TDtv but wanted to see the wider ecosystem support. We believe that this will fall into place in 2009. We think 2009 will also be the year that a successful model for mobile broadcast proves itself out in a number of countries and the upgrade of 3G networks to include integrated mobile broadcast becomes the next logical step after mobile broadband.